Informing Consumers about Smart Devices Act

Bill Summary: Informing Consumers about Smart Devices Act (S. 28)

Overview

The Informing Consumers about Smart Devices Act is a legislative proposal designed to increase transparency and protect consumer privacy in the growing "smart home" market. The bill requires manufacturers of internet-connected devices to explicitly disclose whether a product contains a camera or microphone before a consumer purchases it.

The primary intent of the bill is to prevent "surprise" surveillance, ensuring that consumers are aware if a household product (such as a refrigerator or thermostat) has the capability to record audio or video and transmit that data over the internet.

Key Provisions

1. Mandatory Disclosure

Manufacturers of "covered devices" must provide a clear and conspicuous disclosure prior to purchase stating whether the device contains a camera or a microphone.

2. The "Covered Device" Definition

To avoid unnecessary red tape, the bill specifically defines which products are subject to these rules:
* Included: Consumer products capable of connecting to the internet that contain a camera or microphone.
* Excluded:
* Devices where a camera or microphone is reasonably expected (e.g., smartphones, laptops, tablets).
* Devices specifically marketed as cameras, microphones, or telecommunications equipment.
* Specific apparatuses regulated by the Communications Act of 1934.

3. Enforcement and Oversight

The Federal Trade Commission (FTC) is designated as the enforcement agency.
* Legal Status: A violation of this Act will be treated as an "unfair or deceptive act or practice" under the Federal Trade Commission Act.
* Guidance: Within 180 days of enactment, the FTC must issue best-practice guidelines for manufacturers, including the use of pictorial icons to make disclosures accessible and age-appropriate.
* Tailored Requests: Manufacturers may petition the FTC for specific guidance on how to comply based on their unique product designs.

Impact and Implementation

Who is Affected?

• Manufacturers: Companies producing IoT (Internet of Things) and smart home devices must update their packaging or advertising to include these disclosures.
• Consumers: General consumers will have greater transparency and a better ability to make privacy-informed purchasing decisions.

Timeline and Costs

• Effective Date: The law applies to devices manufactured 180 days after the FTC issues its official compliance guidance. It does not apply retroactively to devices already sold or manufactured.
• Budgetary Impact: The Congressional Budget Office (CBO) estimates the cost of implementation at approximately $4 million over six years (2025–2030), primarily to fund FTC staffing for guidance and enforcement.
• Industry Burden: The CBO notes that most manufacturers already provide this information, suggesting the financial burden on the private sector will be minimal.

Summary Table